“All we’re doing is systematizing certain types of strategies and harvesting premiums that are employed by active managers,” Raol said. “We have primarily decided to focus in these ETFs around value and what we call quality.”

He notes the funds target those factors across U.S. investment grade, high yield and emerging markets, and says that, with tail risk in mind, the exposures have been weighted so that no single factor will overly drive any losses.

Raol describes the new funds as more outcome-focused than Invesco’s existing multifactor bond funds, which he labeled benchmark-focused, in that they do not try to deviate too much from or take on much more risk than the Barclays Aggregate Bond Index.

“They [the new funds] are not really designed to track closely with a particular benchmark, but they are designed to provide income,” said Raol.

“Given the demographic situation happening in the country, we expect there to be a large demand for income-oriented products,” he added. The two funds offer different flavors of income for clients, he says, with IMFD offering more of a pure duration and low-risk income fund, while IMFI provides a lot more income and yield.

“They are two ways to potentially get income in the portfolio, depending on investors’ risk/return appetites,” Raol said.